Jump to content

Recommended Posts

Posted

I have a plan that is well into Top-heavy territory now, and because of the family/HCEs that will not be changing. They have a match now, but if they change to a SHM, this should fix the top-heavy issue, I believe. 

My questions are:

because they're now 29 days to pye, they cannot amend and fix the issue for 21-22, correct? I don't think they're interested in a non-elective SH plan 

They have a non-elective profit sharing source now, if they use SHM to avoid adp/acp and top-heavy, will they need to not contribute to that source again to remain exempt?

 

Thanks for your help.

Posted

9/30/ 2022 is too late to convert to a SH Match, that would have had to have been done prior to the start of the Plan year. They could have added a 3% safe harbor non elective by August 31 (yesterday) or can add a 4% non-elective prior to 9/30/22.

They can go to a safe harbor match for PYB 10/1/2022 but you are outside the safe harbor 30 days before the plan year for distributing the notice. You can probably argue on fact and circumstance that the notice was delivered in a reasonable time before the start of the plan year. The sooner that is done, the more likley it will be deemed reasonable.

 

OPPs just realized PYE in 9/30 and not 12/31 so editing response.

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
×
×
  • Create New...

Important Information

Terms of Use